Minor Racing Bids For Horse Racing Assets Of MI Developments
Minor Racing LLC today offered to purchase substantially all of the horse racing assets of MI Developments Inc. – including some of the nation’s best-known racetracks – with the intent of leveraging technology to transform American thoroughbred racing into one of the world’s most innovative
In a letter to the Special Committee of MI Developments’ Board of Directors, Minor Racing made an all-cash offer, subject to customary due diligence, of $150 million to $170 million for Santa Anita Park, Golden Gate Fields, Portland Meadows, Maryland Jockey Club, Amtote, XpressBet and HRTV. Additionally, Minor Racing offered to acquire Gulfstream Park, Palm Meadows and all other Florida-based racing assets for an additional $150 million.
In its letter, Minor Racing stated that the inclusion of non-core racing assets in MI Development’s portfolio has been significantly detrimental to the interests of the company’s shareholders. “We further believe that selling the racing assets at a fair price would enable the Board of Directors, should it determine that sale of the company is in the best interests of its shareholders, to achieve a significantly better price than the current offer,” wrote Halsey Minor, Minor Racing’s principal.
“I have started several successful media and technology companies, and each time success came by tirelessly driving innovation,” said Mr. Minor. “Modern horse racing is one of the least innovative sports. I believe by making significant digital advancements, horse racing can become one of the most innovative sports and capture the attention and imagination of a whole new generation.
“Horse racing is the world’s most exciting and elegant sport; soon it will also become its most innovative,” said Mr. Minor, who founded or co-founded such successful technology companies as CNET, Salesforce.com and the firm that became Google Voice. “If I could coax 100 million people to learn about computers, I can certainly do the same with horse racing. Man’s special relationship with horses and horse racing is primal. It's practically encoded in our DNA.”
Mr. Minor said Minor Racing has a three-step plan for reversing the decline of the past 60 years in thoroughbred racing. The plan calls for Minor Racing to:
- Purchase and/or lease existing venues;
- Add innovative new technologies and improve overall quality of service and experience;
- Build new experience and place-based venues that transform thoroughbred racing into the world’s most entertaining and innovative sport.
Minor Racing is uniquely positioned to turn around horse racing by building on its deep experience developing transformative technologies. Minor Racing has a fully integrated technology plan that incorporates new experiences for the track, off-site viewing audiences and home or mobile users.
Just as CNET pioneered technology for the web, Minor Racing will pioneer technology for thoroughbred racing. For example, Minor Racing has already proven the ability to deliver 4K2K video of races at the track or to off-site viewing locations. 4K2K video is 10 times as crisp as High Definition. Minor Racing can capture close finishes at over 1,200 frames per second – allowing audiences to cheer those dramatic last few seconds as they play out over 30 seconds in slow motion.
Minor Racing is the only known organization in the world that can take two stereo cameras and create as many as 25 views in 3D so viewers can literally walk around the image of a live race on the screen – without glasses of any kind. Most importantly, Minor Racing does this in real time, unlike other efforts that have a two-hour delay.
By the end of 2011, Minor Racing anticipates being able to place cameras around any track and let the user sit in any position or move with the horses on a 3D display. This kind of 3D technology is revolutionary for any sport and has been in development for more than a year with the horse race track experience in mind.
Mr. Minor said these innovations and others provide a strong foundation for success. In addition, the value of MI Developments has been substantially depressed by the company’s non-core horse racing assets. The bankruptcy of Magna Entertainment, followed by the unexpected absorption of non-core racing assets into MI Developments, has impaired the value of the company, Mr. Minor said.
“MI Developments could be worth substantially more than it is today if the Special Committee and the Board accept Minor Racing’s offer to purchase the non-core, poorly performing horse racing assets that just six months ago were operated into bankruptcy,” Mr. Minor said. “Horse racing assets were never purchased based on any announced strategic plan by MI Developments. Quite the opposite. They were added because of their diminished value after the lengthy and disruptive bankruptcy of the former Magna Entertainment.”